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Private equity

Macquarie buys $800 mn stake in LG Group’s IT firm

Dec 07, 2019 (Gmt+09:00)

Macquarie’s South Korean unit signed a definitive agreement on Dec. 6 to buy a non-controlling stake in LG CNS Co. Ltd., an IT services arm of LG Group, for 951.6 billion won ($800 million), according to a source with knowledge of the matter.

Under the transaction, Macquarie Korea Opportunities Management Ltd. has acquired a 35% stake, or 30.5 million shares, in the system integration company from LG Corp.

The holding company had put the shares up for sale to avoid antitrust rules targeting intra-group business transactions.

In a regulatory filing on Nov. 28, LG Corp. said the stake sale was aimed at improving business competitiveness of LG CNS. Its holding in the IT company was reduced to 49.95% from 85%.

For the stake deal, Macquarie Korea, led by Eric Yong Hwan Kim, nudged out the other shortlisted bidder KKR & Co.

It was Macquarie’s first major investment deal in South Korea since it acquired ADT Caps, a security services firm, for $2.5 billion in October 2018, in a consortium with SK Telecom Co. Ltd.

The deal, handled by JPMorgan, will be finalized around next February after going through the regulatory process, the source said.

Separately, Macquarie has been in exclusive talks with MBK Partners to buy South Korea’s largest industrial gas supplier for around 2.5 trillion won.

By Dong-hun Lee

(Photo: Getty Images Bank)

Yeonhee Kim edited this article

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